Correlation Between Arcelik AS and Biotrend Cevre
Can any of the company-specific risk be diversified away by investing in both Arcelik AS and Biotrend Cevre at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Arcelik AS and Biotrend Cevre into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arcelik AS and Biotrend Cevre ve, you can compare the effects of market volatilities on Arcelik AS and Biotrend Cevre and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Arcelik AS with a short position of Biotrend Cevre. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arcelik AS and Biotrend Cevre.
Diversification Opportunities for Arcelik AS and Biotrend Cevre
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Arcelik and Biotrend is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Arcelik AS and Biotrend Cevre ve in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biotrend Cevre ve and Arcelik AS is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Arcelik AS are associated (or correlated) with Biotrend Cevre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biotrend Cevre ve has no effect on the direction of Arcelik AS i.e., Arcelik AS and Biotrend Cevre go up and down completely randomly.
Pair Corralation between Arcelik AS and Biotrend Cevre
Assuming the 90 days trading horizon Arcelik AS is expected to under-perform the Biotrend Cevre. But the stock apears to be less risky and, when comparing its historical volatility, Arcelik AS is 1.24 times less risky than Biotrend Cevre. The stock trades about -0.01 of its potential returns per unit of risk. The Biotrend Cevre ve is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,770 in Biotrend Cevre ve on September 23, 2024 and sell it today you would earn a total of 15.00 from holding Biotrend Cevre ve or generate 0.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Arcelik AS vs. Biotrend Cevre ve
Performance |
Timeline |
Arcelik AS |
Biotrend Cevre ve |
Arcelik AS and Biotrend Cevre Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Arcelik AS and Biotrend Cevre
The main advantage of trading using opposite Arcelik AS and Biotrend Cevre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arcelik AS position performs unexpectedly, Biotrend Cevre can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Biotrend Cevre will offset losses from the drop in Biotrend Cevre's long position.Arcelik AS vs. Ford Otomotiv Sanayi | Arcelik AS vs. Tofas Turk Otomobil | Arcelik AS vs. Hektas Ticaret TAS | Arcelik AS vs. Eregli Demir ve |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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